TSMC to raise advanced chip packaging prices by up to 20%, report says

Taiwan Semiconductor Manufacturing Co. (TSMC) may increase its charges for advanced chip packaging by up to 20%, according to a report in the Commercial Times. The surge in demand for artificial intelligence (AI) is straining the capacity of the semiconductor supply chain, according to industry sources quoted in the report. Chip-on-wafer-on-substrate (CoWoS) packaging, commonly used in high-performance AI processors, is expected to face price hikes of 10% to 20%.

The report suggests that the increased demand extends beyond graphics processing units to include server central processing units and custom application-specific integrated circuits. Longer testing periods for AI chips are exacerbating the pressure on packaging and testing capacities. Equipment lead times have also lengthened, stretching from three to six months to six to eight months, as chipmakers prioritize delivery schedules and suppliers grapple with expanding production swiftly.

Analyst estimates cited by the newspaper indicate that TSMC's CoWoS monthly capacity is projected to surpass 130,000 wafers in 2026, potentially reaching 200,000 in 2027. The reported price increases highlight the impact of the AI infrastructure boom on costs across the semiconductor industry, as manufacturers strive to meet the heightened demand.